Report: PAC finds govt confused about MySejahtera procurement, no formal contract aside from an NDA

The government appeared to be “confused” and could not ascertain who decided on the development and procurement of the MySejahtera mobile application, Public Accounts Committee (PAC) chairman Wong Kah Woh said.

He said that there was major confusion on which specific official or agency appointed KPISoft Sdn Bhd to develop MySejahtera, the government’s official Covid-19 tracking app, in April 2020.

“From what I can say, the procurement process was not well handled.

“Because in normal circumstances, the government will either have direct negotiations with the vendor or have an open tender or a limited tender.

“Here, the big confusion is ‘who made the appointment and what was the justification?’. This was [one of] the key questions we asked,” Wong said in a report by The Edge yesterday.

He added that there has been no formal contract entered between the government and KPISoft since day one, aside from a non-disclosure agreement (NDA) signed between the National Security Council (NSC) and KPISoft on the data collected via the app.

Wong said this after a three-hour session on the development and procurement of MySejahtera, during which the PAC called in representatives from three agencies under the Prime Minister’s Department, namely NSC, the Malaysian Administrative Modernisation and Management Planning Unit and the National Cyber Security Agency.

Last week, Health Minister Khairy Jamaluddin and Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz were called in to testify on the same issue.

“I can only say I think the government themselves are confused as to who [made the decision]. That is quite a serious issue of government appointment,” he added.

Wong, who is also DAP’s Ipoh Timur MP, explained that “the documentation records for the appointments are not clear.”

He said apart from the NDA signed, there is no other contract signed after two years (since the app was rolled out to firm up) the parties’ obligations and the costs involved.

“Those are the most important things. And now the government is still (saying) they are in the midst of negotiating the price with the vendor, and this is something that shouldn’t [be happening] at all.

“If you have a government procurement you need to finalise the terms from day one, (not) wait two years down the road (to go) into negotiation.

“(Our concern is) why the government is putting themselves in a situation whereby they have to pay the developer for MySejahtera, of which in fact the whole thing has started as a CSR (corporate social responsibility),” he said.

Wong also stressed that key questions asked were about the appointment process of KPISoft, now Entomo (M) Sdn Bhd, in developing the MySejahtera application, namely which agency endorsed the appointment.

“Some other issues (included) whether there were other companies who had put up their proposals, and what the justifications of this appointment were and also the status of the proposal by way of CSR which now turned out to be so called limited CSR of one year.

“We want to know whether at the start of the proposal (whether) the CSR idea was already there or not,” Wong said.

“We raise again the issue of intellectual property rights owner of MySejahtera app, in view of a legal suit where the parties claim that the rights are owned by MySJ Sdn Bhd.

“This claim is supported by the fact that there were sales of shares and licensing agreement which involved a sum of over RM300 million,” he added.

Moving forward, Wong said that the PAC may call anyone after they have dispensed with the agencies from the Prime Minister’s Department.

He said that the PAC will need to go through documents and evidence which have been shared to determine if they need to call any more witnesses to testify before giving their final report on the MySejahtera procurement.

“We will go through evidence given by the minister’s last week and today.

“We haven’t decided on whether to call further witnesses,” he said.

He added that if they do not require more witnesses then the PAC will finalise their report to be handed to Parliament.

The PAC investigation was initiated after news broke that MySejahtera’s developer Entomo Malaysia was in a five-year licence agreement with its nominee’s subsidiary MySJ for the transfer of the MySejahtera app to the latter for a RM338.6 million price tag.

MySejahtera’s ownership also caught public attention following a shareholder dispute initiated by MySJ’s 7.03 per cent shareholder P2 Asset Management Sdn Bhd against Revolusi Asia Sdn Bhd, Entomo Malaysia and MySJ.

Revolusi is a nominee for Entomo in holding the majority stake of 81.43 per cent in MySJ.

The app was originally a CSR initiative by Entomo Malaysia, then known as KPISoft.

Despite Prime Minister Datuk Seri Ismail Sabri Yaakob previously saying that the government would pay for MySejahtera’s usage from April 1, 2021, the PAC confirmed that no payment has been made so far.

The PAC, in a December 2021 report, said that the government should not be paying for the use of the app as it was developed as a CSR initiative. —  Malay Mail

Related reading

• Khairy: Govt will not compromise confidentiality of MySejahtera user data, denies app is sold to private company
• Report: MySJ Sdn Bhd agreed to pay RM338.6 million for MySejahtera IP and software license
• Khairy insists MySejahtera app and data belongs to govt, not involved in court case over IP buyout
• PAC will begin inquiry into the development and procurement of MySejahtera in mid-April